Tate & Lyle to dissolve sugar assets Vietnam

The sugar sector has provided the firm with some sweet profits

During a meeting with the Minister  of Planning and Investment  Vo Hong Phuc last week, a Tate & Lyle representative said the UK-based company would sell its stake in the Nghe An Tate & Lyle Sugar Company in the central region, ending its 14-year presence in Vietnam.

The representative said the move was a part of Tate & Lyle’s strategy in withdrawing from its historic sugar business.

“It is not because we are in trouble in Vietnam, we are exiting the sugar business to focus on specialty food ingredients,” he said.

In its annual report 2010, Tate & Lyle announced its business in Vietnam was going well thanks to improved sugar prices.

Nghe An Tate & Lyle Sugar Company is one of the last sugar refining factories that Tate & Lyle is involved in.

Previously, the company sold all its sugar factories in the United States and in May it announced an agreement for the sale of its European Sugar Refining operations to American Sugar Refining Inc.

At the end of this month, Tate & Lyle would choose an investment bank that would help the company find investors interested in the Nghe An mill, the representative said.

“All data relating to our operations in Vietnam will be sent to investors who care about this sale. We will select investor through a competitive bidding,” he said.

The $120 million sugar mill was built in central Nghe An province in 1996 and has a total annual capacity of 240,000 tonnes of sugar. Tate & Lyle holds a 75 per cent stake in the mill, with Nghe An Sugar Company and Thai sugar group Mitr Phol the remainder and considered as the best option to buy out the UK firm.

Tate & Lyle expected the process to be completed by the end of this year. However, the timeline could be extended till March 2011, the end of Tate & Lyle’s financial year 2010.

“This is a big opportunity for other foreign investors to enter into sugar business in Vietnam,” said Phuc.

He said Tate & Lyle was one of the most successful foreign investors operating in the country.